Swiss ban sale of VW diesel cars

The Environmental Protection Agency (EPA) said on Friday that it would introduce major changes to its diesel tests to avoid a repeat of Volkswagen’s cheating by installing a software that allows the vehicle to pass lab tests but spews emissions when driven.

Volkwsagen, the biggest carmaker in the world, later admitted that around 11 million cars worldwide, 2.8 million of them in Germany, are fitted with the so-called “defeat device” and that further costly recalls and refits are possible. The U.S. justice department has launched a criminal investigation while the United Kingdom has ordered the Vehicle Certification Agency to rerun lab tests on VWs and compare the results with “real-world” driving conditions.

The EPA’s findings of the scandal cover 482,000 cars in the USA only, including the VW-manufactured Audi A3, and the VW brands Jetta, Beetle, Golf and Passat.

Mueller will continue to act as Chairman of Porsche AG until a successor has been found, it added.

No more relying exclusively on dyno testing, in other words.

It was revealed a little over a week ago that VW was dodging the tests.

The announcement came after Volkswagen appointed Porsche chief Matthias Mueller on Friday to steer it out of the widening scandal over pollution test rigging.

The statement of the EPA was made in a letter delivered to vehicle manufacturers, indicating it will not depend entirely on laboratory testing to ensure the cars’ emission performance.

Mueller himself vowed that his “most pressing task will be to restore confidence in the Volkswagen Group – through an unsparing investigation and maximum transparency, but also by drawing the right lessons from the current situation”.

VW’s shares plummeted around 30% in the days after the scandal broke, and chief executive Martin Winterkorn resigned on Wednesday.

German authorities has given scandal-hit Volkswagen (Other OTC: VLKAF – news) an October 7 deadline to set out a timeline for bringing all its diesel cars in line with national pollution guidelines, a newspaper said Sunday.

In addition to the leadership shakeup, VW’s overarching Supervisory Board has announced a restructuring that touches every area of the organization. Sales in Europe are many times that total-about half of VW’s European sales involve diesel-powered vehicles. According to a report Saturday by German daily Handelsblatt, VW is planning to offer a free fix for the 11 million affected vehicles and customers will be contacted in the coming weeks.

“We’re angry, we’re disappointed”, Scott Bahr told CBS News.